13th May 2009

Bridges Weekly - Kirk’s Geneva Visit Signals US Engagement on Doha

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The United States government is re-engaging in the Doha Round trade talks at the WTO, a move that has been warmly received by Geneva-based trade negotiators. But it remains to be seen whether the US and its trading partners will be able to overcome the significant substantive differences that have thus far prevented the negotiations from coming to a successful close.

In a clear show of support for the talks, US Trade Representative Ron Kirk made his first visit to Geneva this week and offered what several delegates described as constructive signs of engagement on the Doha Round negotiations.

Since Barack Obama became US president earlier this year, Geneva-based delegates have been waiting to see what stance the new Obama administration would take in the struggling talks, which have progressed in fits and starts since they were launched nearly eight years ago. The USTR’s visit this week provided a venue for some of delegates’ pending questions to be aired.

”The world has given us an opportunity to reset our relationship with a lot of our partners,” Kirk told journalists in Geneva on Monday, AFP reported. “This is an opportunity for me to listen to hear their perspectives as well as to share my own.”

Several trade officials acknowledged that the visit to WTO headquarters marked a significant effort to engage on the part of the USTR.

”He came to assure people that [the Obama administration is] not sweeping the Doha Round beneath the carpet,” one developing country delegate said.

”He chose Geneva to announce to the world that they’re still attached to the Doha Round, they still attach value to it.”

Kirk’s short stop in Geneva was filled with a whirlwind of meetings. On Monday, the USTR met with the Group of Latin American and Caribbean countries, consulted with the heads of the WTO’s negotiating groups, and had working lunches and dinners with a number of other ambassadors. The following day, he met with WTO Director-General Pascal Lamy and Swiss trade minister Doris Leuthard and had sessions with the African and Least Developed Countries (LDC) Groups, as well as with several other ambassadors. A working dinner with EU Trade Commissioner Catherine Ashton was scheduled for Wednesday evening.

The former Dallas mayor, who is known as an affable people person, not a policy wonk - put his schmoozing skills to work in his back-to-back meetings this week.

”He has inherited Obama’s charisma,” said one WTO ambassador who met with Kirk on Tuesday. “I had the best impression of him.”

And although Kirk is still new to his position - he was officially sworn in less than two months ago - the new USTR seems to have picked up on the technical aspects of his job with ease.

”He’s learning fast,” the ambassador said.

Skip modalities?

Informal discussions about a potential new approach to the Doha Round negotiations figured prominently in several of Kirk’s meetings, sources said. The United States and Canada are major supporters of the new idea, which would have delegates skip the negotiation of modalities - the broad outlines of a deal to liberalise world trade - and move directly into scheduling tariffs (see Bridges Weekly, 6 May 2009, http://ictsd.net/i/news/bridgesweekly/46289/).

But many developing countries have strongly resisted this approach, and they made their concerns clear to Kirk this week, sources said.

”We as developing countries would be put in a corner” under the new approach, said one delegate whose ambassador met with Kirk on Tuesday. Skipping modalities could allow rich countries to bully poorer Members into giving extra concessions in the talks, he said.

Kirk brought up the ‘skipping modalities’ idea at a lunch meeting of WTO delegates on Tuesday, sources said, but got strong push-back from developing country negotiators. The USTR, who stressed that he was in ‘listening mode’ for the meeting, acknowledged the countries’ concerns with the approach and said that a ‘third way’ would have to be found for moving forward in the talks. No one has articulated what such an alternate approach might look like.

But the USTR seems intent on keeping the process aspects of the talks front and centre. “We should all be willing to consider changes to the process that would put the negotiations on a more direct path to success,” Kirk said at a press conference Wednesday morning, AFP reported.

Kirk’s visit might have brought some comfort to delegates who fear that the US’ primary aim in the Doha Round talks is to fight for market access for its exporters, and that Washington does not recognise the Doha Round’s mandate to help developing countries prosper through trade.

Kirk does, at least in his rhetoric, seem to acknowledge the development dimension of the negotiations. In a meeting with the African Group and the Group of Least Developed Countries (LDCs), Kirk said that “weaker developing countries should not be made to carry the burden of concluding the Doha Round,” according to an official who attended the meeting.

Despite the renewed level of engagement from the US, WTO delegates remain pessimistic about the odds of concluding a global trade deal this year. One developing country ambassador went so far as to claim that such an outcome would be “physically impossible” before the end of 2009.

Doha Prospects in the US

While Kirk has stressed that the US is committed to the Doha Round, and that an agreement could prove to be a powerful tool for economic recovery, he has also signalled that a few areas of the negotiations would be tricky for the US, and that domestic politics could make deal-making difficult.

The US has real misgivings about the existing Doha package, especially its market access provisions, Kirk has said; agriculture subsidies, especially for cotton, are also sensitive. Kirk has also made clear that Washington wants large developing countries to think creatively about what they can put on the table, although he has stressed that the US is ready to do its part in the talks.

On the domestic front, some say that the ongoing economic crisis could provide an opportunity for the USTR to ‘sell’ the importance of trade liberalisation to the US public. But at least for the foreseeable future, the administration will have a limited amount of political capital to devote to trade, given that the president has identified other issues - namely energy, healthcare and the domestic economy - as his policy priorities.

But senior Democratic lawmakers have indicated that relations between Congress and the Executive branch are much less strained now than they were when George W. Bush was in office, a fact that could make it easier for trade deals to win lawmakers’ approval. However, there are still some vocal trade sceptics within the president’s own Democratic Party, and a vote on any major trade deal would most likely end up dividing the group.

ICTSD reporting; “US top trade negotiator in first visit to WTO,” AGENCE-FRANCE PRESSE, 12 May 2009; “US trade chief commits to clinching Doha deal,” REUTERS, 13 May 2009; “US top trade negotiator says ‘new path’ needed for Doha,” AGENCE-FRANCE PRESSE, 13 May 2009.

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